Cincinnati Bell accelerates its FTTH and IPTV plans

Cincinnati Bell (NYSE: CBB) may not be the size of its larger former Bell System compatriots AT&T (NYSE: T) and Verizon (NYSE: VZ), but it is innovating with new products like Fiber to the Home, IPTV and now energy services to offset inevitable declines in its traditional PSTN voice business.

On the FTTH side, Cincinnati Bell has been taking a careful growth approach, passing around 80,000 homes in Cincinnati and Northern Kentucky. Not content to rest on its laurels, the service provider plans to pass an additional 70,000 homes by bringing fiber into specific neighborhoods.

Of course, Cincinnati Bell is being realistic about its FTTH deployment. To augment its Fioptics TV service, the service provider will introduce its own IPTV service over its copper lines sometime later this month.

Ted Torbeck, president and general manager of Cincinnati Bell Communications, told Cincinnati.com that delivering IPTV over its copper lines is all about scale. By leveraging its existing copper network to deliver IPTV, it will be able to reach three times as many homes today than it can deliver over fiber.

Scaling the reach of a FTTH network, even for smaller ILECs like Cincinnati Bell, still requires a large investment. "We've invested $140 million so far and we still have only about 12-15 percent of the market covered," Torbeck said.

But Cincinnati Bell is not stopping with FTTH and IPTV services. In June, the ILEC made a surprising turn when it announced it would begin offering residential customers electric service via a partnership with Viriden Energy.

Since launching the service late last month, Cincinnati Bell reported it has signed up 1,400 customers for the service. Going forward, the service provider plans to introduce energy service plans for businesses in addition to offering natural gas services.

While it will take time to assess how successful Cincinnati Bell's bets on IPTV, FTTH and energy will be, these moves represent the service provider's need to differentiate against the growing cable threat and ongoing wireless voice service substitution.